RFBT

Easy
1. When the obligation modified its object and also the principal conditions
a. There is real novation
b. There is personal novation
c. There is mixed novation
d. There is delegacion

2. A debtor may still be held liable for ·loss or damages even if it was caused by a fortuitous event in any of the
following instances, except:
a. The debtor is guilty of dolo, malice or bad faith, has promised the same thing to two or more persons who do not
have· the same interest
b. The debtor contributed to the loss.
c. The thing to be delivered is generic.
d. The creditor is guilty of fraud, negligence or delay or if he contravened the tenor of the obligation.

3. In general, to show the existence of a partnership, three (3) of the following characteristics must be proved. Which is
the exception?
a. There was a joint interest in the profits.
b. There was an agreement in writing.
c. There was an intention to create a partnership.
d. There was a common or joint fund obtained from contributions.

4. Which of the following cannot be a valid object of a contract?

a. Transmissible rights c. Possible services
b. Future inheritance d. Future things

5. A general professional partnership must

a. Pay corporate income tax
b. Have two or more partners
c. Have written articles of partnership
d. Provide for apportionment of liability for partnership debts.

6. Under this doctrine, the corporation may exercise only powers expressly authorized by law or incident to its existence:
a. Doctrine of separate juridical personality
b. Doctrine of limited capacity
c. Doctrine of piercing the veil of corporate entity
d. Trust fund doctrine

7. The report of election of directors, trustee and officer must be submitted to the Securities and Exchange Commission
within
a. Thirty (30) days after the election of the directors, trustee and officers of the corporation.
b. Sixty (60) days after the election of the directors, trustee and officers of the corporation.
c. Ninety (90) days after the election of the directors, trustee and officers of the corporation.
d. One hundred twenty (120) days after the election of the directors, trustee and officers of the corporation.

8. The bill was accepted as follows: “Accepted payable to PNB Manila (Sgd) X”. The acceptance is?
a. General acceptance c. Qualified conditional
b. Qualified local d. Qualified acceptance
9. Batas Pambansa Blg. 22 (Bouncing Check Law) punishes the act as an offense against:
a. Property c. Person
b. Good custom d. Public order
10. It is one brought by one or more of the stockholder or members in the name and on behalf of the corporation to
redress wrongs committed against it or to protect or vindicate corporate rights, whenever the officials of the
corporation refuse to sue, or are the ones to be sued or hold control of the corporation.
a. Mandamus c. Appraisal right
b. Quo warranto d. Derivative suit

AVERAGE
1. Michael Fermin, without the authority of Pascual Lacas, owner of a car, sold the same car in the name of Mr. Lacas to
Atty. Buko. The contract between Atty. Buko and Mr. Lacas is ---
a. void because of the absence of consent from the owner, Mr. Lacas.
b. valid because all of the essential requisites of a contract are present.
c. unenforceable because Michael Fermin had no authority but he sold the car in the name of Mr. Lacas, the owner.
d. rescissible because the contract caused lesion to Atty. Buko.

2. John Dela Rosa issued a promissory note to Celine Cruz on Oct 24, 2015 as follows:
Manila, Philippines Oct 20, 2015
“I promise to pay to the order of Celine Cruz Ten thousand pesos (P100,000) on Oct 20, 2016 with interest of 12%
p.a.
Sgd (John Dela Rosa)”
In this case:
a. The interest runs from Oct 24, 2015.
b. The interest runs from Oct 20,2015.
c. The instrument is non negotiable
d. The interest is computed based on P100,000.

3. In contract of commodatum, this attribute of ownership is transferred:

a. Jus abutendi c. Jus fruendi
b. Jus utendi d. Jus vindicandi

4. In three of the following corporate proposals, a dissenting stockholder has the right to surrender his shares of stock to
the corporation and demand for the payment of their fair market value. Which is the exception?
a. Sale, mortgage or disposition of all or substantially all of the corporate assets
b. Shortening or extending the corporate term
c. Investment of corporate funds in another corporation or business
d. Entering into management contract with another corporation

5. Statement I - The reason for the prohibition of pactum commissorium is that the amount of loan obtained from the
creditor is usually much less than the actual value of the thing pledge or mortgaged. If allowed, the creditors is
effortlessly enriched at the expense of the debtor.
Statement II - A pledge or mortgage is indivisible even though the debt may be divided among the successors in
interest of the debtor or of the creditor.
a. First statement is true; second statement is false.
b. First statement is false; second statement is true.
c. Both statements are true.

6. A and B agreed to contribute their respective farms to form a partnership. A immediately delivered his land. B
waited until after 2 months so he could harvest some rice in his farm. What may the parties do?
a. B should deliver the land and the rice he harvested.
b. B is allowed to keep his land until a formal demand is made.
c. A should also be allowed to harvest any fruits in his land.
d. A should ask for a rescission of the contract of partnership.

7. Which phrase best completes the statement -- A chattel mortgage can be constituted to secure:
a. obligations both past and future;
b. obligations existing at the time the mortgage is constituted;
c. future obligations only;
d. past obligations only.
8. Ernesto donated a mobile phone worth P32,000 to Hubert orally and delivered the unit to Hubert who accepted.
Which statement is most accurate?
a. The donation is void and Ernesto may get the mobile phone back.
b. The donation is void but Ernesto cannot get the mobile phone back.
c. The donation is voidable and may be annulled.
d. The donation is valid.

9. Under Central Bank Circular 537 series of 2006 (Dated: July 18, 2006), which of the following is not legal tender:
a. P10,000 in the denomination of P20 bills
b. P900 in the denomination of P5 coins
c. P750 in the denomination of P1 coins
d. P120 in the denomination of P0.25 coins

10. A, B, C and D are partners where A, B and C contributed P1,000,000 each and D his services. The partnership is
engaged in the manufacture and export of garments. Due to a very strong typhoon, the entire roofing of the factory
was blown by the strong winds and if not repaired immediately would aggravate the damage. A, B, C and D agreed on
an additional contribution of P200,000 each in order to save the business from imminent loss. Which of these is the
correct statement?
a. D is duty bound to contribute 20% more of his time to the business of the partnership.
b. If A no longer has money, he can be compelled to sell his interest in the partnership to the other partners.
c. B can question the decision because he did not vote for the additional contribution.
d. If C still has money, but refuses to make the contribution, he can be compelled to sells his interest in the
partnership to the other partners.

Difficult
1. The boards of directors are allowed to fill up the following vacancies?
I. The vacancy in the board was the result of the removal by the stockholders or members
II. The vacancy in the board was due to expiration of term
III. The vacancy in the board was due to an increase in the number of directors
IV. Vacancy of corporate secretary
a. I and II c. III and IV
b. II and III d. IV only

2. Which of the following stipulations or features of a promissory note (PN) affect its negotiability, assuming that the PN
is otherwise negotiable?
I. The date of the PN is “February 30, 2012.”
II. The PN bears interest payable on the last day of each calendar quarter at a rate equal to five percent (5%) above
the then prevailing 91-day Treasury Bill rate as published at the beginning of such calendar quarter.
III. The PN gives the maker the option to make payment either in money or in quantity of palay of equivalent value.
IV. The PN gives the holder the option either to require payment in money or to require the maker to serve as the
bodyguard or escort of the holder for 30 days.
a. I and III c. I, II and III
b. III only d. I, II, III and IV

3. Paul granted Joven the right to sell as an “agent” Paul bags in Luzon. Joven was obliged under the contract to pay for
the bags, at a discount of 10% as commission on the sale. The payment had to be made whether or not Joven was able
to sell the bags. The contract is one of:
a. Sale c. Agency to buy
b. Agency to sell d. Trust agreement

4. “The majority vote of its board of directors and by the vote or written assent of the stockholders representing at least
two-thirds of the subscribed capital stock of the corporation” is prescribed under the Corporation Law for this purpose
a. For declaration of stock dividends.
b. For adoption of any by-law or by-laws.
 c. To invest its corporate funds in any corporation or business, or for any purpose other than the main purpose for
which it was organized.
d. To amend the articles of incorporation.

5. A and B are partners in buying and selling automobiles. A, by the partner’s agreement, was authorized to buy any
immovable’s on a cash basis, never on the installment plan. One day A bought on installment plan a parcel of land
with improvements from X, a client. X did not know of A’s lack of authority. A’s purchase was made on behalf and in
the name of the partnership. Is the partnership bound?
a. No because A was not really authorized to buy on installment plan and the same is not “apparently carrying on in
the usual way the business of the partnership”.
b. No because A failed to obtain the consent of all partners although he was authorized to buy any immovables.
c. Yes because although A was not really authorized, still for “apparently carrying on in the usual way the business
of the partnership” A is implicitly authorized and X did not know of A’s lack of authority.
d. Yes because all transaction made by any partners with third person is valid provided the latter acted in good faith.

6. Placido, a bank depositor, left his checkbook on his desk at his house. Unknown to him, a visitor at the time, noticing
the same, took a check therefrom, filled it up in the amount of P3,000 and succeeded in encashing the check on the
same day. Placido’s account was thereby debited in the same amount.
Discovering the erroneous debit, Placido demanded that the bank credit him with a like amount. The bank refused on
the ground that Placido was negligent in leaving his checkbook on his desk so that he could not put up the defense of
forgery or want of authority under the Negotiable Instrument Law.
The facts disclose that even to the naked eye, there were marked differences between Placido’s signature and the one
in the check forged by the visitor. As between Placido and the bank, who should bear the loss?
a. The bank should bear the loss because the bank warrants the genuineness of the signature of its current depositor.
b. The bank is not liable because the sole cause of the loss is due to the negligence of Placido in leaving his
checkbook on his desk at his house.
c. Placido must suffer the loss because he is negligence in keeping his checkbook.
d. Placido should bear the loss because the bank exercise reasonable diligence in determining that the signature is
not forged.

7. D mortgaged his house and lot to C as security for the loan amounting to P1M. Which of the following statements is
correct?
a. C may automatically be the owner of the mortgaged house and lot upon non-payment of the loan, if that is
stipulated in their written contract
b. If there is stipulation prohibiting D to sell his house and lot while the loan remains unpaid, D cannot sell the
mortgaged property before the maturity date of the loan.
c. If the mortgaged property is foreclosed but the proceeds of the sale is less than the amount of the loan, C has no
more right to demand payment of the balance from D
d. If the written contract of mortgage is not registered at the Office of the Registry of Deeds, the real mortgage is
still valid between D and C

8. Which of the following contract is essentially gratuitous:

a. Commodatum
b. Precarium
c. Deposit
d. Mutuum
a. I and II c. I, II and III
b. I and III d. I, II, III and IV

9. On December 26, 2014, Antonio, Buddy, Cruzado executed a promissory note to pay Danica the sum of P6,000,000
jointly and severally with interest of 12% per annum within one (1) year. However, at the time when the note was
executed, Buddy was a minor. In addition, Danica had given Cruzado an extension of one year to pay:
a. Danica can recover P2,000,000 from Antonio because Buddy minority as well as the extension given to Cruzado
is a partial defense for Antonio.
b. Danica cannot recover any amount from Buddy and Cruzado because the defense is complete in so far as Buddy
and Cruzado is concern.
 c. Buddy is liable for the entire P6,000,000 minus his share of P2,000,000 as personal defense for minority and
another P2,000,000 personal defense for the extension given to Cruzado leaving a balance of P2,000,000. Buddy
can later on recover reimbursement from Antonio and Cruzado.
d. Cruzado is liable for the entire P6,000,000 minus his share of P2,000,000 as personal defense for extension of
time and another P2,000,000 personal defense minority of Antonio leaving a balance of P2,000,000. Cruzado can
later on recover reimbursement from Antonio and Buddy.

10. On February 14, 2015, Honey sent Fresca a written offer to purchase Fresca’s land. The offer included the following
provision: “Acceptance of this offer must be registered or certified mail, received by Honey no later than February 20,
2015 by 5:00 p.m.” On February 20, 2015, Fresca sent Honey a letter accepting the offer by private overnight delivery
service. Honey received the letter on February 21, 2015. Which of the following statements is correct?
a. A contract was formed on February 21, 2015
b. Fresca’s letter constituted a counteroffer.
c. Fresca’s use of the overnight delivery service was an effective form of acceptance.
d. Contract was formed on February 20, 2015 regardless of when Honey actually received Fresca’s letter.

Clincher

1. Under Philippine Cooperative Code of 2008 (R.A. 9520), which of the following comply with the minimum
requirement of the law to form a cooperative?
Authorized share Subscribed Capital Paid in Capital
Capital

a. P100,000 P25,000 P10,000

b. P50,000 P25,000 P12,500

c. P50,000 P30,000 P15,000

d. P5,000 P5,000 P5,000

Answer: C
No cooperative, other than a cooperative union as described under Article 25 hereof, shall be registered unless the articles
of cooperation is accompanied with the bonds of the accountable officers and a sworn statements of the treasurer elected
by the subscribers showing that at least twenty-five per centum(25%) of the authorized share capital has been subscribed
and at least twenty-five per centum (25%) of the total subscription has been paid: Provided, That in no case shall the
paid-up share capital be less than Fifteen thousand pesos (P15,000.00). (Art 13, par 5 RA 9520)

2. The minimum numbers of organizer of primary cooperative is:

a. Five (5) Natural person c. Fifteen (15) Natural person
b. Ten (10) Natural person d. Twenty (20) Natural person

Answer: C
ART. 10., RA 9520,  Organizing a Primary Cooperative. – Fifteen (15) or more natural persons who are Filipino citizens,
of legal age, having a common bond of interest and are actually residing or working in the intended area of operation,
may organize a primary cooperative under this Code: Provided, That a prospective member of a primary cooperative
must have completed a Pre-Membership Education Seminar (PMES).

3. In the morning of May 3, 2016, there was a head-on collision between a taxi of the Malate Taxicab driven by Pedro
Fontanilla and a carretela guided by Pedro Dimapalis. The carretela was overturned, and one of its passengers,
16-year-old boy Faustino Garcia, suffered injuries from which he died two days later. A criminal action was filed
against Fontanilla and right to bring a separate civil action was reserved. Severino Garcia and Timotea Almario,
parents of the deceased, brought an action against Fausto Barredo as the sole proprietor of the Malate Taxicab and
employer of Pedro Fontanilla under Art. 2180 on vicarious liability. It is undisputed that Fontanilla 's negligence was
the cause of the mishap, as he was driving on the wrong side of the road, and at high speed. The court rendered
judgment ordering Fausto Barredo to pay Severino Garcia and Timotea Almario for Damages. However Fausto
 Barredo Question the decision of the Court because the plaintiff did not show proof that the assets of Pedro Dimapilis
has been exhausted.
a. The contention of Fausto Barredo is correct because the liability of the employer under the revised penal code is
subsidiary.
b. The contention of Fausto Barredo is not correct because Severino Garcia and Timoteo Almario is recovering civil
liability based on quasi delict, and the Civil code provides that the liability of the employer for the damage caused
by its employee is direct and primary.
c. The contention of Fausto Barredo is correct because the liability of the employer together with his employee is
joint and subsidiary.
d. The contention of Fausto Barredo is not correct because the liability of the employer under the revised penal code
is direct and primary.

4. When funeral expenses are borne by a third person, without the knowledge of those relatives who were obliged to give
support to the deceased, said relatives shall reimburse the third person, should the latter claim reimbursement. This is
a. Negotiorum gestio c. Nominate quasi contract
b. Solutio indebiti d. Innominate quasi contract

5. Dodgie owes Cathy the sum of P100,000 guaranteed by Josie. Sasy, a stranger to the obligation offers to pay Cathy
P100,000 and the latter accept the offer of payment. However, Dodgie already paid Cathy P45,000. The payment by
Sasy is with the consent of Dodgie. Sasy may recover from Dodgie:
a. P100,000 and to subrogate to the guaranty
b. P55,000 and to subrogate to the guaranty
c. P100,000 but not entitled to subrogate to the guaranty
d. P55,000 only because this is the only amount redounded to the benefit of Dodgie.

6. Ms. Maputi agreed to live with Mr. Hukluban as the wife of the latter without the benefit of marriage in exchange for
the monthly support of thirty thousand (P30,000.00) that Mr. Hukluban would give to Ms. Maputi. Both Mr. Hukluban
and Ms. Maputi are single, of legal age, and there is no legal impediment for them to get married. Their parents have
no objections to the two getting married. Based on the foregoing information, which of the following statements is
true?
a. Mr. Hukluban may legally demand that Ms. Maputi live with him as his wife.
b. Ms. Maputi may legally demand that Mr. Hukluban give her the monthly support of P20,000 that he had
promised.
c. The agreement between Mr. Hukluban and Ms. Maputi is valid because they can legally get married if they want
to.
d. The agreement between Mr. Hukluban and Ms. Maputi is void for being contrary to morals.

7. On January 5, 2016, Jeac wrote Lilibeth a letter, offering to sell his only house and lot in BocaueBulacan for
P1,000,000 and the letter of offer was received by lilibeth on January 9, 2016. On January 10, 2016, Lilibeth wrote a
letter of acceptance, which was received by Jeac on January 15, 2016. Under theory of manifestation the contract is
perfected on
a. January 9, 2016
b. January 10, 2016
c. January 15, 2016
d. January 10 or 15 2016 at the option of Lilibeth

8. A conferment of a direct benefit in a contract between two persons in favor of a third person who must accept such
benefit before the same is withdrawn is known as:
a. Stipulation por autrui
b. Policitacion
c. Pactumreservatidominii
d. Counter-offer

9. Karen, an art collector, promised Henry, an art student, that if Henry could obtain certain rare artifacts within two
weeks, Karen would pay for Henry’s postgraduate education. At considerable effort and expense, Henry obtained the
 specified artifacts within the two-week period. When Henry requested payment, Karen refused. Karen claimed that
there was no consideration for the promise. Henry would prevail against Karen based on
a. Unilateral contract.
b. Unjust enrichment.
c. Public policy.
d. Quasi contract.

10. Anna, who was sixteen years old, purchased an P80,000 computer from Elsa Electronics. On several occasions Anna
returned the computer to Elsa for repairs. Anna was very unhappy with the computer. Two days after reaching the age
of eighteen, Anna was still frustrated with the computer’s reliability, and returned it to Elsa, demanding an P80,000
refund. Elsa refused, claiming that Anna no longer had a right to disaffirm the contract. Elsa’s refusal is
a. Correct, because Anna’s multiple requests for service acted as a ratification of the contract.
b. Correct, because Anna could have transferred good title to a good-faith purchaser for value.
c. Incorrect, because Anna disaffirmed the contract and the action for annulment is not prescribe.
d. Incorrect, because Anna could disaffirm the contract at any time.
 EASY
1. The buyer of a thing has the right to the fruits of the thing:
a. From the time the thing bought is delivered.
b. From the time the sale is perfected.
c. From the time the obligation to deliver the thing bought arises.
d. From the time the fruits are delivered.

2. O is the owner of a night club where SC is a singer crooner receiving a monthly salary of P80,000. The obligations
of O and SC are –
a. Both real
b. Both personal
c. Real on the part of S.C. but personal in the part of O.
d. Real in the part of O but personal in the part of SC.

3. A natural obligation under the New Civil Code of the Philippines is one which
a. the obligor has a moral obligation to do, otherwise entitling the obligee to damages.
b. refers to an obligation in writing to do or not to do.
c. the obligee may enforce through the court if violated by the obligor.
d. cannot be judicially enforced but authorizes the obligee to retain the obligor’s payment or performance.

4. B, while drunk, accepted a passenger in his taxicab. B then drove the tax recklessly, and inevitably, it crashed into
an electric post, resulting in serious physical injuries to the passengers. The latter then filed a suit for tort against
B's operator, A, but A raised the defense of having exercised extraordinary diligence in the safety of the
passenger. Is his defense tenable? (2011 Bar)
a. Yes, as a common carrier can rebut the presumption of negligence by raising such a defense.
b. No, as in tort actions, the proper defense is due diligence in the selection and supervision of the employee by
the employer.
c. No, as B, the common carrier's employee, was obviously negligent due to his intoxication.
d. Yes, as a common carrier can invoke extraordinary diligence in the safety of passengers in tort cases.

5. Lennie bought a business class ticket from Alta Airlines. As she checked in, the manager downgraded her to
economy on the ground that a Congressman had to be accommodated in the business class. Lennie suffered the
discomfort and embarrassment of the downgrade. She sued the airlines for quasi-delict but Alta Airlines countered
that, since her travel was governed by a contract between them, no quasi-delict could arise. Is the airline correct?
(2011 Bar)
a. No, the breach of contract may in fact be tortious as when it is tainted as in this case with
arbitrariness, gross bad faith, and malice.
b. No, denying Lennie the comfort and amenities of the business class as provided in the ticket is a
tortious act.
c. Yes, since the facts show a breach of contract, not a quasi-delict.
d. Yes, since quasi-delict presupposes the absence of a pre-existing contractual relation between the
parties.

6. Under a contract executed on November 1, 2015, D obliged himself to give a specific horse to C on December 10,
2015. On December 8, 2015, C demanded the delivery of the horse but D did not comply. The following day, the
horse was struck by lightning and died instantly.
a. The obligation of D is extinguished because the loss is due to fortuitous event and D was not in default.
b. The obligation of D is not extinguished because D can deliver another horse.
 c. The obligation of D is not extinguished because D was in default.
d. The obligation of D is not extinguished because the demand was not made on due date.

7. D is driver of a passenger bus which is owned and operated by O. While D is driving said bus, it met an accident
through his negligence where P, a passenger, was injured. O is liable to P for damages which arises from:
a. Law c. crime
b. contracts d. quasi-delict

8. The obligation of the employer to pay death benefits and funeral expenses for his employer’s death while in the
course of employment as sanctioned by the Workmen’s Compensation Act is one that arises from:
a. Law c. Quasi contract
b. Contracts d. Answer not given

9. When A voluntarily takes charge of the neglected business of B without the latter’s authority where
reimbursement must be made for necessary and useful expenses, there is a:
a. Quasi delict c. Negotiorum gestio
b. Quasi contract d. Solutio indebiti

10. It is not a source of liability which will entitle the injured party to damages:
a. Culpa Aquiliana or negligence committed in the performance of a spontaneous act.
b. MORA or delay.
c. Dishonesty, malice or bad faith in the performance of an existing valid obligation.
d. Contravention of the tenor of obligation.
 AVERAGE

1. X and Y were to marry in 3 months. Meantime, to express his affection, X donated a house and lot to Y, which donation X
wrote in a letter to Y. Y wrote back, accepting the donation and took possession of the property. Before the wedding,
however, Y suddenly died of heart attack. Can Y’s heirs get the property?
a. No, since the marriage did not take place.
b. Yes, since all the requisites of a donation of an immovable are present.
c. No, since the donation and its acceptance are not in a public instrument.
d. Yes, since X freely donated the property to Y who became its owner.

2. S offers to sell his car to B for P125,000.00 cash. B accepts the offer but is willing to pay only P120,000.00.
a. The contract was perfected at the price of P125,000.00.
b. The contract was perfected at the price of P120,000.00.
c. The contract was perfected at the price of P122,500.00, the average price of the offer and the acceptance.
d. The contract was not perfected because the acceptance by B was qualified and it constituted a counter-offer.

3. To defraud his creditors, A contracted B by selling a land to B. B now seeks to register the land with the Register of
Deeds. X a creditor of A seeks to prevent the registration on the ground that the contract is rescindable. Despite X’s
objection may the land be registered based on the contract in B’s name.
a. The land cannot be registered based on the contract which is rescindable.
b. The land cannot be registered because the contract is in fraud of creditor.
c. The land can be registered based on the contract because the contract is not yet rescinded.
d. The land can be registered because the contract is valid and can be attacked collaterally in a land registration
proceeding.

4. Under the following contracts the rights and obligation are not transmissible except:
a. Contract of lease
b. Contract of agency
c. Contract of partnership
d. Contract of commodatum

5. In a contract, as written, Dave promises to pay Carlo P20,000 on September 15, 2017. The consideration received by
Dave is not stated in the contract:
a. The contract is valid because the cause is always presumed to exist.
b. The contract is valid so long as it is in writing.
c. The contract is valid because cause is not essential to a contract.
d. The contract is void because the cause is not stated.

6. A solemn or formal contract has the following essential elements:

a. consent of the contracting parties, object certain and cause or consideration.
b. consent of the contracting parties, object certain, cause or consideration and delivery of the object.
c. consent of the contracting parties, object certain, cause or consideration and formalities required by law.
d. consent of the contracting parties, object certain, delivery of the object, and formalities required by law.

7. On May 1, 2012, S offered to sell a specific car to B for P500,000.00. B sent his letter of acceptance to S on May 8,
2012. On May 10, 2012, however, S died in a vehicular accident and his secretary received the letter of acceptance on
May 12, 2012 unaware that S had already died.
a. The contract was perfected on May 8, 2012 when B sent his letter of acceptance.
b. The contract was perfected on May 12, 2012 when the secretary of S received the letter of acceptance.
c. The contract was not perfected because the offer of S became ineffective when he died.
d. The contract was perfected on May 1, 2012 because the acceptance made by B on May 8, 2012 retroacts to the date
of the offer.
8. Orencia is the owner of a car which was sold by Say without authorization in favor of Billy. The contract between Say and
Billy in so far as Orencia is concerned is:
a. Valid c. Unenforceable
b. Rescissible d. Voidable

9. Mistake in three of the following will make a contract voidable. Which one will not?
a. Mistake as to the substance of the thing which is the object of the contract.
b. Mistake as to the principal conditions which principally moved one or both parties to enter into the contract.
c. Mistake as to the identity or qualifications of one of the parties, which identity or qualifications have been the
principal cause of the contract.
d. Simple mistake of account.

10. S sold his only car for P100,000.00 to B. Unknown to S, B bought the car from him so that he could use the same in a
bank robbery. What is the status of the sale of the car by S to B?
a. The sale is void because the motive of B is illegal.
b. The sale is valid because the illegality of the motive of the parties to the contract does not have any effect on its
validity.
c. The sale is voidable because of the failure of disclose his motive to S.
d. The sale is rescissible at the instance of S would be damaged by the illegal motive of B.
 DIFFICULT

1. Anne owed Bessy P1 million due on October 1, 2011 but failed to pay her on due date. Bessy sent a demand letter
to Anne giving her 5 days from receipt within which to pay. Two days after receipt of the letter, Anne personally
offered to pay Bessy in manager's check but the latter refused to accept the same. The 5 days lapsed. May Anne’s
obligation be considered extinguished? (2011 Bar)
a. Yes, since Bessy’s refusal of the manager’s check, which is presumed funded, amounts to a satisfaction of
the obligation.
b. No, since tender of payment even in cash, if refused, will not discharge the obligation without proper
consignation in court.
c. Yes, since Anne tendered payment of the full amount due.
d. No, since a manager’s check is not considered legal tender in the Philippines.

2. Allan bought Billy’s property through Carlos, an agent empowered with a special power of attorney (SPA) to sell
the same. When Allan was ready to pay as scheduled, Billy called, directing Allan to pay directly to him. On
learning of this, Carlos, Billy's agent, told Allan to pay through him as his SPA provided and to protect his
commission. Faced with two claimants, Allan consigned the payment in court. Billy protested, contending that the
consignation is ineffective since no tender of payment was made to him. Is he correct?
a. No, since consignation without tender of payment is allowed in the face of the
conflicting claims on the plaintiff.
b. Yes, as owner of the property sold, Billy can demand payment directly to himself.
c. Yes, since Allan made no announcement of the tender.
d. Yes, a tender of payment is required for a valid consignation.

3. When a third person of his own accord and even without the knowledge of the original debtor assumes the
obligation with the consent of the creditor:
a. Expromission c. Subrogation
b. Delegacion d. Real novation

4. Which of the conclusion is correct?

a. D who indebted to C in the amount of P100,000 conveys to C ownership of his jeep which later on was found
out to have a value only of P70,000. D still owes C P30,000.
b. D who is indebted to C in the amount of P100,000, conveys to C the ownership of his jeep with an agreed
appraisal value of P150,000. C is now obligated to Pay D P50,000.
c. F, a father, is indebted to C, a creditor, in the amount of P15,000,000. F dies leaving to his only son S a house
and lot valued at P10,000,000. If S voluntarily pays C P15,000,000 he can recover the excess payment of
P5,000,000.
d. S offered the sale of a house and lot to B for P10,000,000 giving to the latter an option of 60 days. B paid S
P10,000 as option money. There is already as between S and B a perfected contract of sale.

5. Upon the proposal of a third person, a new debtor substituted the original debtor without the latter’s consent. The
creditor accepted the substitution. Later, however, the new debtor became insolvent and defaulted in his
obligation. What is the effect of the new debtor’s default upon the original debtor?
a. The original debtor is freed of liability since novation took place and this relieved him
of his obligation.
b. The original debtor shall pay or perform the obligation with recourse to the new
debtor.
c. The original debtor remains liable since he gave no consent to the substitution.
d. The original debtor shall pay or perform 50% of the obligation to avoid unjust
enrichment on his part.
6. On December 23, 2008, Carlota, the owner of a sarisari store, purchased several bags of "Yummy" candy worth
P1,000.00 from Delisyus, an authorized dealer of the product. Carlota tendered her payment to Delisyus
consisting of 200 pieces of P5.00 coins. In this case:
a. Delisyus may refuse to accept the payment and demand that she be paid in bills.
b. Delisyus cannot refuse to accept the payment because what Carlota was offering as payment is legal
tender.
c. Delisyus may consign the payment in court if Delisyus refuses to accept it and his obligation is automatically
extinguished.
d. The tender made by Carlota was invalid because the tendered amount is not legal tender.

7. The delivery of a private document evidencing a credit, made voluntarily by the creditor to the debtor even before
the debt is paid, extinguishes the obligation by:
a. Express remission c. Compensation
b. Implied remission d. Novation

8. Statement 1: The nullity of the principal obligation carries with it that of the penal clause.
Statement 2: Payment means not only the delivery of money but also the performance, in any other manner, of
an obligation.

a. First statement is true; second statement is false.

b. First statement is false; second statement is true.
c. Both statements are true.
d. Both statements are false

9. Which of the following is not an element of Compensation:

a. Debts to be compensated are due and demandable.
b. There is controversy or adverse claim over any debts to be compensated.
c. There are two or more debts of the same kind.
d. There are two persons who are creditors and debtors of each other.

10. Payment by third person are presumed for the benefit of the creditor in the following cases, except:
a. Ratification c. Estoppel
b. Subrogation d. Determinacion

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